CFS Retail (CFX)

Challengers to
CFS Retail
are emerging, including the revamped Centro Retail and Westfield Retail Trust spun off from Westfield Group less than a year ago. But CFS is expected to hold its own with a portfolio of high-quality retail assets and outlet malls. The sector is facing challenges from weak consumer sentiment and online retail, but CFS has performed well. It has more than 99 per cent occupancy in its wholly Australian portfolio and a modest gearing rate of 27 per cent. The company’s bottom line has been bolstered by the purchase of a portfolio of DFO outlet centres late last year. Its share price has rallied from a 12-month low of $1.51 on August 8 to trade around $1.79 this week, as analysts have come out in support of its merits. Credit Suisse has an “outperform" rating on several retail landlords, including CFS, given their steep trading discounts to net tangible assets.